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I still don't understand what's the game that Apple is trying to play here. Manufacturing a car is completely a different business to small digital devices and

• lawxls 3y ago
  Apple has a fruit logo
• supafastcoder 3y ago
  Back in 2018, when Tesla was still worth $55B and Apple had more than $100B in the bank, they could've acquired Tesla in an all cash deal, but for some reason didn't. I think they would've made a great match.
  • selectodude 3y ago
    Because Tesla was, is, and will continue to be overvalued as a car company. Why pay the “tech premium” for a manufacturing firm when you already have all of those core competencies in house?
    • smoldesu 3y ago
      I agree with you, but Tesla did get things in gear fast enough to ship cars, early. If Apple's car ships in 2028 (and that's optimistic), then they'll be 20 years late to Tesla's party. The early mover advantage is worth something, not what investors value it at but still a hefty sum.
      • selectodude 3y ago
        Apple could spin up a joint venture with, say, Rivian or even Ford for 1/10th of that tomorrow. I’ll be honest, I think the whole Apple car thing is a pipe dream. Apple doesn’t have some sort of magic that is two decades beyond anybody else driving in circles underneath their weird spaceship campus. If they have their own full self driving, it doesn’t matter who assembles the car. They can sell the tech to everybody.
        • LightBug1 3y ago
          But isn't the Apple way to combine hardware and software better than anyone else? I've only ever bought an Apple tableet for my wife, so I've got no bias here. But I'd be keen to see what they can produce. If only to differentiate the market up a bit ... it's as boring as hell at the moment and why I haven't pulled the trigger on one.
      • threeseed 3y ago
        > then they'll be 20 years late to Tesla's party There is no being late. People buy multiple cars in their lifetime and new car companies will come and go.
      • greedo 3y ago
        Apple doesn't care a bit about the early mover advantage, if that even exists. iPod -> Nope, there were lousy players out before it. iPhone - > Nope, smartphones were around before 2007. iPad -> Nope, tablets, ugly ugly tablets were around too.
      • __d 3y ago
        Tesla is busy throwing away that first mover advantage. And the CEO is busy trashing the brand. I don't think Apple has a problem here. I suspect they're much more interested in what's happening with the Chinese manufacturers.
        • rpmisms 3y ago
          Tesla is now moving into making their cars cheaper, with exceptional results. That's leveraging your first mover advantage: compete where others can't, because your manufacturing process is mature.
    • lmm 3y ago
      > Why pay the “tech premium” for a manufacturing firm when you already have all of those core competencies in house? Well, doing it in house doesn't seem to be working out for them.
      • __d 3y ago
        I don't think it's an execution problem: it's a product design problem. When/if they figure out what they want to build, I expect they're leverage their existing expertise in partnering with third parties to churn out product.
    • CydeWeys 3y ago
      Tesla clearly wasn't overvalued when it was only worth $55B though, at least not now with the benefit of hindsight.
      • selectodude 3y ago
        The market can stay irrational far, far longer than I can stay solvent.
        • redox99 3y ago
          Tesla's P/E with a market cap of 55B would be 5.5. How is that overvalued?
          • sroussey 3y ago
            That’s more than GM.
            • CydeWeys 3y ago
              So? Tesla is currently earning about 50% more profit than GM is, surely it should correspondingly be valued higher?
        • danielmarkbruce 3y ago
          Pffft. They have done over 10 billion net in the past couple years. High ROE. They have a big, durable competitive advantage with their buying process v other companies (just go through the buying process across a number of car types). They have a big competitive advantage in staff capabilities, also in the ability to actually produce software. Elon is no dummy. He targeted fat tired old industries to attack. It was brilliant. He now faces possibly the weakest competition in large business. Suggesting it's worth less than $55 billion is silly.
    • ericd 3y ago
      But they don’t have all the core competencies in house. I don’t think manufacturing a small, mostly solid state rectangles with maybe one major stress bearing hinge is the same as manufacturing a highly dynamic multi-ton steel machine that is meant to transport people 200,000 miles over a decade or two any more than an aluminum smelting firm could suddenly dominate glass manufacturing if they decided to.
      • ActorNightly 3y ago
        They don't have to have it in house. You can pay external companies to design shit for you, and manufacture it. Tesla does everything in house because they need to keep costs low to stay profitable. Apple doesn't.
        • ericd 3y ago
          I don’t think it’s really Apple’s MO to outsource product design to any significant extent, though they do use a lot of contract manufacturing, my understanding is that they dictate how a lot of that’s done. Their brand is all about quality and seamless integration between everything, you don’t get that without being involved in every aspect.
          • ActorNightly 3y ago
            They won't outsource design, but they can outsource the engineering needed to make that design safe. Its not like the "boutique car from a consumer electronics" market is saturated, they can take more risks in regards to info leaking.
  • mandeepj 3y ago
    > they could've acquired Tesla in an all cash deal, but for some reason didn't. Muskeeter wanted Apple CEO position in return > I think they would've made a great match. Ask that to Mr. Cook :-)
• actionfromafar 3y ago
  That VR thing? Could have combat fighter visibility around/through the car, and with sensor fusion.
• CharlesW 3y ago
  > I still don't understand what's the game that Apple is trying to play here. It's a fair question, which was also raised when the iPod was introduced. It helps to see Apple as an "affordable luxury smart things" company. Dumb, ICE-based cars were a poor fit, but smart, mostly solid-state vehicles may not be. Automotive is just another product category large enough to matter to Apple. A possibility not mentioned in the article is that Apple may initially partner, as they did with Motorola for the ROKR (but hopefully more successfully). Sony, the company Apple wanted to be when it grew up, is doing this with Honda for their first car, the Afeela. > Tesla had the advantage of being the first mover in the EV market… Apple has gone up against several first-movers that are now gone or are shadows of their former selves. It's neat that Tesla will be remembered as people's first EV, but it's not enough to ensure their market position 20 years from now. Tesla has no special sauce that I'm aware of.
  • jim0266 3y ago
    The "special sauce" for Tesla is in the manufacturing, or as Elon Musk likes to say, "the machine that built the machine." Musk has built a corporate culture that drives innovation and change at breakneck speeds. Seek out a few Joe Justice videos to dive deeper into this. Tesla has upended the way cars are being built with mega casting and structural battery packs. Their next-gen car will be another step change with the "unboxed" method. The odds of anyone catching Tesla is about nil. Apple's chance may be less than that. Are they going to pay BYD to make cars for them and lose that margin?
  • oh-4-fucks-sake 3y ago
    2-3 years ago, I was thinking something similar along the lines of "yeah, why doesn't Apple just stick with computers/phones/peripherals/software." But if anything's become clear in the last few years in the EV market are issues with: reliability, software/firmware, usability, aesthetics, build-quality, and high startup capital requirements. Apple is a perennial expert UX/design/durability/usability. Sure there's been a few boondoggles over slight decreases in QA and quality (butterfly keyboards)--but at the end of the day, most of us still love at least some of their products because they still, usually "just work". Apple is also quite good (whether or not you like it) at building walled gardens. Imagine if Apple released a rock-solid car and an absolutely kick-ass charging network that rivals Tesla's? There's be demand. The biggest, most-obvious reason why Apple could succeed at building a car is that they have massive amounts of cash. The #1 reason these fly-by-night EV startups fail is because they can't handle 5-10 years of negative margins coupled with massive capital costs. Apple could burn billions before their EV division becomes profitable and not even blink.
• surfingdino 3y ago
  It's the new Apple Pippin. If Apple wants to win at personal transportation game it needs to skip a generation ahead and offer something vastly different than the old car platform loaded with the latest tech packaged in the sleek Apple look.
• sureglymop 3y ago
  Apple already have a global scale mesh network that's used for e.g. AirTags. iPhones are just absolutely everywhere, they have the true internet of things. I imagine that could be very interesting for self driving technology.
  • madeofpalk 3y ago
    Why is that interesting? How are AirTags useful for cars?
    • fragmede 3y ago
      Having one in your car so when it gets stolen you know where it is, is pretty useful.
      • blinding-streak 3y ago
        This is already standard in upscale new cars. My 3 year old Subaru SUV has this built in to the Subaru Mobile app. GM OnStar has been doing this for a decade plus.
      • madeofpalk 3y ago
        Well, you don't really need to make a whole car for that.
  • comboy 3y ago
    "Thanks to our best sensors yet, Apple Car will not run over any person wearing any Apple product" (applause)
  • m463 3y ago
    this might be the away-from-homepod
  • kelnos 3y ago
    > iPhones are just absolutely everywhere ... in the US. iPhone market share is much lower in other countries. I do wonder if it's low enough to affect things like their Find My network.
• crazygringo 3y ago
  I mean, given Tesla's market cap I think similar expected long-term profitability is Apple's game here. And yes, bootstrapping everything from scratch is exactly what Apple has to do. The competitive advantage Apple would have is simply in the car's design -- reimagining cars from scratch based on not just batteries but especially interface technology. And nobody has a proven track record of profitable consumer design at the level of Apple's. Just brainstorming, everything from heads-up displays for driving directions and safety alerts, to eye tracking to determine whether the driver has seen an upcoming sudden obstacle detected by LIDAR, to who knows what manufacturing and materials innovations they can come up with. A lot of individual elements that other manufacturers can provide as well, but Apple manages to make them seamless and natural and "just work" for the average person.
• jandrewrogers 3y ago
  Modern cars are largely undifferentiated mechanically, whether ICE or EV. Every auto manufacture assembles a car from primarily third-party parts plus a dwindling number of semi-custom assemblies. These are skinned with a look and feel appropriate for the brand. It has never been easier to build an automobile manufacturing company from scratch. You don't have to build much yourself. It is primarily a problem of managing the complex global supply chains. And of course the branding and marketing to penetrate an already saturated market. With the physical parts of the car commoditized to oblivion, the primary opportunity for product differentiation is in the sensors, software, and UX. All the automotive OEMs know this. For better or worse, the traditional automotive companies are terrible at this part of the business and they do it reluctantly. It isn't in their DNA, and their traditional production processes are unsuited to it. When the two big execution problems of building a modern automotive company are "software, sensor, and UX design" and "efficiently managing complex global supply chains", it is easy to see why Apple might be uniquely positioned to be successful at it.
  • antipaul 3y ago
    Agree. "software is eating the world" someone once said a decade ago, and yet most car companies still didn't get the memo. MBux, anyone?!? Personally, if Apple creates a standard car simply with a great software experience (I'd expect at least a few small novelties), and not too expensive, then I am totally in.
    • SoftTalker 3y ago
      What are the chances that: a) You can operate it without talking to it b) It has dedicated knobs/levers/switches for primary essential controls. c) It doesn't require internet connectivity, continual tracking/telemetry etc.
      • buffington 3y ago
        Given Apple's emphasis on UX and UI: 100% across the board. Ask any Tesla Model 3 Owner what they like the least about their cars, and you'll hear a lot of them complain about the touchscreen-only (sorta) interface. There's some levers and thumb wheels, sure, but I abhor my touchscreen-only interface. Love the car. Hate the UI. Apple knows how to build interfaces. Including interfaces outside of software. I suspect it'll be the primary thing they focus on in the product launch video, how they didn't screw up the UI and there will be knurled titanium wiper speed ring switchy things and tactile feedback in the damn mushroom leather wrapped heated steering wheel and Jony Ive whispering directions, seemingly inside of your head.
• BurningFrog 3y ago
  This may well be true. But I can't help thinking back to 2007 when so many were saying how hopeless breaking in to the very competitive and competent cell phone industry would be.
  • macintux 3y ago
    > “We’ve learned and struggled for a few years here figuring out how to make a decent phone,” he said. “PC guys are not going to just figure this out. They’re not going to just walk in.” – Palm CEO Ed Colligan
    • amelgares 3y ago
      I've always thought this statement rephrased makes more sense: "We've learned and struggled for a few years here figuring out how to make a decent computer," he said. "Mobile phone guys are not going to just figure this out. They're not going to just walk in." - Imaginary Steve Jobs
• spywaregorilla 3y ago
  if apple starts doing the massive capex investments to try and build an auto manufacturing plant, investors should sue to stop the from taking such an enormous risk. I think the game is simply that they don't want to admit it's a stupid idea and so they're keeping it on life support.
  • yreg 3y ago
    Perhaps those investors should sell their shares instead. And Apple doesn't have to admit anything. They have never promised a car, they don't even have to acknowledge such a project ever existed if they cancel it.
    • spywaregorilla 3y ago
      > And Apple doesn't have to admit anything. They have never promised a car, they don't even have to acknowledge such a project ever existed if they cancel it. I'll know. You'll know.
      • yreg 3y ago
        Apple doesn't care at all. Why should they? It's normal to have internal research projects that don't go anywhere. We also don't know almost anything about the project other that it probably exists.
        • spywaregorilla 3y ago
          Oh I just like it for discussion with annoying fanboys
          • yreg 3y ago
            Perhaps you should reflect to be less rude.
            • spywaregorilla 3y ago
• ckbishop 3y ago
  I would assume that they have known Elon Musk is a fraud longer than the general public, and want to position themselves in the market before Tesla inevitably collapses.
  • rpmisms 3y ago
    Ah yes, the fraud who caused the EV revolution and has the highest loyalty car brand in the US, and also created the best-selling car in the world. I'm not going to pull up the rules, but this breaks at least one. Please argue in good faith.
    • ckbishop 3y ago
      You can pull this up, if you'd like. https://www.investors.com/news/tesla-earnings-slide-40-next-gen-vehicle-elon-musk/ https://www.investors.com/news/tesla-earnings-slide-40-next-...
      • rpmisms 3y ago
        So, they're pushing hard to get a budget car out, and are still setting records on deliveries. I'm looking forward to this phase.
• grecy 3y ago
  > I still don't understand what's the game that Apple is trying to play here. Manufacturing a car is completely a different business to small digital devices I agree 100%, and I don't think it makes any sense for Apple to manufacture cars in any way similar to the way legacy automakers do it now. That is old-school. Slow, expensive, capital and resource intensive. I don't think Apple have any interest in having enormous factories churning out massive vehicles that have tens of thousands of parts, long-tail warranty and repairs, etc. etc. If Tesla have taught the industry, it's that the way legacy automakers build vehicles is archaic, and there are much faster/cheaper/better ways. As much as Apple want their vehicle to be self-driving, the fact they're willing to down-rate it to a Level 2+ makes me think that isn't actually the focus. What if Apple start building vehicles on an scale and in a manner than has never been conceived before? Tesla currently have the best in the industry having a Model Y come off the line every 40 seconds [1], and they've said they want to halve that with their new "smaller vehicle" coming soon (TM). Hypothetically, what if Apple's play here is not to "re-invent the car", but more-so "reinvent the way cars are manufactured". ? [1] https://www.torquenews.com/15475/tesla-gigafactory-shanghai-manufacturing-model-y-faster-you-can-brew-espresso https://www.torquenews.com/15475/tesla-gigafactory-shanghai-...
  • fragmede 3y ago
    right. it's not about the machine that makes the machine, it's about the machine that makes the machine that makes the machines.
    • m463 3y ago
      For apple, that would be china (and korea and india and ...)
    • grecy 3y ago
      Elon has said a few times he would like to make an entire car the same way they make matchbox cars - i.e. one single injection moulded piece. It will be incredibly interesting to see if Apple really are working on new manufacturing techniques.
• InitialLastName 3y ago
  Apple has enough cash on hand to purchase a major car company outright. I don't think "existing players don't let us in their sandbox" is likely to be a major hurdle. That said, even Tesla spent ~4 years manufacturing and selling a very-low-volume hype car before they attempted to move towards the mass market (and that mass-market product has taken a decade thus far to approach Apple's reputed standard for quality).
  • jliptzin 3y ago
    No way Apple will touch a 100 year old car company with a 10 foot pole
    • freeAgent 3y ago
      Yeah, but they can buy people and everything that follows.
      • jahewson 3y ago
        That would be debt.
    • YetAnotherNick 3y ago
      Generally what happens in things like these is that the existing company would continue function as it is, just there will be a new shiny department which has maximum funding and ability to make decisions.
• jes5199 3y ago
  A car and a smartphone are both basically just big batteries with some peripherals attached and a minimal computer interface
  • steve_adams_86 3y ago
    Apple has basically been making cars for 16 years.
    • eimrine 3y ago
      We believe that a modern car is impossible without an Android in it.
• nox101 3y ago
  Obviously they want 30% of every place the car takes you because you're "their customer" and "their car delivered you". Don't pay the 30%? No problem, the car won't drive customers there. I'm only half joking.
• deleted 3y ago
  [deleted]
• jnaina 3y ago
  The current ICE-age (pun intended) Auto OEM dinosaurs are struggling to transition themselves from metal benders, to software innovators. Gone are the days where the complexity was in building complex Internal combustion engines (ICE), with associated complex mechanical drive-train. EV technology has reduced the bill of materials to mostly batteries, motors and tons of software. The batteries and the motors (essentially the "skateboard" in EV parlance) can be sourced externally. The key differentiator is the software defined innovation. Everything from the connected mobility application, to AV/ADAS, the in-cabin UX, etc. And Apple already has most of the pre-cursors (chatbot, maps, CarPlay, OTA, iCloud for CDP, telemetry systems, etc). Only thing not quite in place is the AV and ADAS systems. Which is where Apple is focusing their R&D.
  • pbmonster 3y ago
    To be fair, there's still a lot of metal-bending (or carbon fiber forming, which the old dinosaurs learned quickly enough) going on when you make an EV. After all, you're still trying to move two tons of sprung mass over a bumpy surface as smoothly as possible, without any of the thousands of individual parts rattling or letting in water. The Germans pretty much dropped the ball on software and UX from the very beginning. But they're still decent enough at bending metal around batteries and electric motors, and that seems to be enough for huge profits.
• hef19898 3y ago
  Apple is big in sub-contracting manufacturing for all there products. And there are thise shops for cars as well, e.g. Magna. And those are really good at that. Same goes forbdesign and development, if you want. Still surprised Apple is really doing it so, the automotive market is cut throat, mostly low margin. But we will see.
• machiaweliczny 3y ago
  Tell that to (old) battery producers in China, they dominate market globally